payment facilitator (payfac)
A payment facilitator (payfac) is a business registered with the card schemes through an acquirer that signs up other businesses as sub-merchants under its own master account, prices them, and takes responsibility for onboarding, monitoring, funds and losses. Synapto is not a payment facilitator.
A payfac does for its sub-merchants what an acquirer does for its merchants, under an acquirer's sponsorship. It onboards them quickly under one master account, sets their prices, aggregates their settlement and takes the loss when a sub-merchant fails to deliver or disappears. In the UK, a business that receives funds on behalf of others and passes them on is in most arrangements providing a regulated payment service: the FCA's guidance on the commercial agent exclusion says a firm is likely to be acting for both payer and payee, and so likely to need authorisation, if money passes through an account it controls before reaching the payee. That brings safeguarding, capital and reporting obligations with it.
Why it matters to a software platform: becoming a payfac is the model that earns the full margin and carries the full risk. Most platforms should decline it. The alternative that keeps the earning without the licences is a regulated-partner model, where the platform's customers sign up inside the product, each customer is settled in full by a regulated acquiring partner, which holds the licences and funds throughout.
To be plain: Synapto is not a payment facilitator, is not the regulated party and does not hold or safeguard anyone's money. We set up a platform's payments on top of a regulated acquiring partner that does.